Xbox sales drop, but Microsoft revenue r…

It looks like a new white version of something is going to be released soon. Recently, Microsoft shared their latest financial results, and it’s clear that their acquisition of Activision Blizzard has had a big impact. Ever since Microsoft officially acquired Activision Blizzard last October, their gaming division has seen a significant increase in revenue, which is no surprise.

In the last sales quarter, which ended on December 31, 2023, Microsoft’s gaming revenue rose by 49% to a whopping $7.1 billion. However, despite this growth, sales of Xbox hardware have continued to decline, especially in Europe. This trend continued in the latest financial quarter, which ended on March 31, 2024, with gaming revenue increasing by 51% year-over-year to $5.45 billion. This growth can be attributed to the acquisition of Activision Blizzard, which has also caused Xbox content and services revenue to go up by 62%.

According to Microsoft’s CEO Satya Nadella, the addition of Activision Blizzard games has led to some impressive milestones for the company, including setting third quarter records for game streaming hours, console usage, and monthly active devices. However, no specific figures were released. Nadella also mentioned the success of adding Diablo 4 to their Game Pass subscription service, which resulted in one of their biggest first Game Pass launches ever, with over 10 million hours played in the first 10 days.

It’s evident that all the positive growth in Microsoft’s gaming division can be attributed to their acquisition of Activision Blizzard, particularly with the ownership of Call of Duty. In fact, this acquisition, along with Xbox’s shift towards multiplatform games, has even led to more Microsoft games appearing in the top 20 of the PlayStation Store than Sony’s own games.

While this change in approach has been financially successful, it raises questions about the future of Xbox hardware. The declining sales of the Xbox Series X/S have prompted Microsoft to already start discussing their next generation hardware, which is expected to be released in 2026. But what will happen if this next console also falls short?

Another concern is that the significant growth seen this year is mainly due to Activision Blizzard, a company that Microsoft did not own at this time last year. This means that next year, when this factor is taken out of the equation, the growth will likely decrease drastically. This raises worries about Microsoft acquiring more companies in the future just to keep their numbers on the rise.

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